Tenant is not happy with the granny flat construction

The tenant (in the main house) is very unhappy that a granny flat construction ( at the back) will start in the next week so they are planning to move out. I spoke to the PM and found that they have a baby in a few weeks so they have a concern the construction ( maybe.. Noise...) disturbs their rest/sleep.

I know the timing is really bad as I expected to construct earlier in this year but it took much time to get the council approval ( ..Is it normal? in QLD Logan council. ).

Anyway, I wanted to minimise the loss so I offered $15 pw rental reduction until the construction is completed if they stay. I am currently waiting for the tenant's reply via the PM.

- Fixed term rental agreement until the Jan 2017.
- Weekly rent $330.

I would like to hear any feedback/thought/suggestions from you in this forum.
If you were me, how could you handle this situation?

 

Good idea to drop the rent.. I imagine it would be really difficult to attract a new tenant when there is a construction site out back.

Maybe let the existing tenant know that work will only be completed during X and Y times and give them assurance that there will be hopefully not too much impact.

 

Did you tell your tenant about the GF construction when they were signing the lease?

I would offer $30 and pay the water bill too. Where is your builder going to get the power from?

 

did you inform them prior to signing the lease that you intended to build sometime soon?

are they losing any of their backyard etc or was the area for the granny flat fenced off?

if it was fenced off and they arent losing any specific amenity then i think youd have a decent case in telling them they cant walk away. whether or not you choose to let them do so or offer a discount would then be you being reasonable and understanding but you wouldnt have to imo.

how long have they been there for and when was the lease or renewal signed?

 

this is definitely relevant, if builder is going to use water and power from the front house then tenant would be justified in not being happy. what about parking etc? are they effectively going to lose any of their carbays or garden or anything during construction? if so then ultimately its only fair for you to cop the loss @joe2030 . they would have rented an entire property and now their landlord is telling them not only are they going to have construction to deal with but their yard is smaller but builder will be using their power etc.

all comes down to what they were informed of or what they rented and if theyre losing access to any significant part of what you told them they were renting.

 

Thanks, legallyblonde. That is my concern to find a new tenant during the construction. The worst scenario is losing the rent of 8-10 weeks until the construction is completed. $330 * 8-10 weeks = $2640 - $3300. Ouch!

 

HI devank, That is a good point I should think about the power and water bill too. The PM told the GF plan when signing and a few times in this year. But we told the GF schedule last week because of the council approval. I think if they had no baby, they would be okay.

 

the baby is not a factor in determining whether or not they can legally cancel their lease, even if it clearly affects their intention to stay or not.

what's more relevant are the other points brought up above.

 

Hi Sanj, the current tenant signed the lease last Dec and the lease will expire on Jan 2017. The PM told me that she delivered the message about the GF plan at the beginning and sometimes as the plan was progressed. The problem was I could not provide the fixed schedule as there are lots of processes/issues to delay the plan unfortunately.

The Logan council told we are not allowed to build the fence between the main house and the GF based on their regulation. I will build the fence soon after the completion as the builder suggested. There are not fences currently the tenant has around 400 sqm huge backyard. I think they don't use much.

 

well technically they still are losing their backyard, which, unless they signed something acknowledging that it would be lost in the future when construction started, they could probably use as a justifiable reason to ask for compensation or lease to be terminated.

what about parking? will they be affected by builders parking in their bays or right outside front door or bedroom windows etc?

personally providing a specific schedule to them wasnt the key item, if you had something signed with them clearly stating what would occur and that they were aware then youd be fine.

 

Hmmm, I should've written the special condition in the rental agreement about the GF plan to use the half of back space... not for the tenant. I only told over phone and emailed to PM to TELL the tenant.

 

Thank you, sanji. I will talk to the builder tomorrow about the water/power usage, car parking.

 

lol yep....if its not in their lease they have every right to walk......
(...and if I was a tenant....I would be walking, its not my problem so why put up with the noise agro etc)

We had a situation for one of our IP's in Sydney where the house next door has filed a DA, the tenants left even before DA was approved once their fixed term expired. We signed into the new lease if construction goes ahead we will give them the last 4 weeks of 1 year lease as rent free had 4 applications for the property on the first 20 minute open house.

We are 6 months into the lease and still no construction so very happy tenants but I assume it will start in the spring as DA was approved etc

 

I'd be offering them more than $15 off per week.
If it's only for 8-10 weeks $150 to stay and put up with it, don't be surprised if they laugh at your offer. $50-$75 per week would be fairer... $500 or $3300 your call

 

Agreed. I was in a similar situation recently with my GF builds, and I gave full disclosure to my tenants - GF plans, timeframes, contingencies, the works. I still knocked off $50/week on a $300/week rental during the period of construction.

Mostly because, good luck trying to find a replacement tenant while construction is going on...

 

yeh im doing one atm and giving them 100$ off from memory (440 to 340$)..tho mine have been there a while and haven't missed a beat..but 15$ is too tight...with the tradies coming and going and the noise etc

 

$15 discount is giving each tenant a whole $1.07 per day discount to put up with that disruption. I'm definitely with the others on this one.

 

The tenant has every right to walk away.
I would.
Life is stressful enough with a new baby without the noise and disruption of living on a building site.
Marg

 

Why are you building a GF out the back? Can the tenants use this after it is built? Are you going to rent to out to another party? Are you and your grandma going to be moving in when the lease expires?

 

Considering this hasn't been documented in the lease, you may not have any right to access the property. Grounds of quiet enjoyment, etc. Phone calls to and from the PM won't cut it and i doubt emails are enough. This should have been a special condition of the lease or at the very least a counter signed addendum. As others have mentioned in the event you are even able to proceed with the GF project at least a circa 25 to 30 percent knocked off the rent will go a fair way to keeping rapport.